CRTC Working ‘Quickly’ to Decide Whether to Tax Online Platforms: Chair

A CRTC logo is shown in Montreal on Sept. 10, 2012. Graham Hughes/The Canadian Press

As Canadians still cannot see news on Meta platforms following backlash to Bill C-18, Canada’s broadcasting regulator is actively determining whether a tax should be imposed on online sites to bolster struggling media companies.

“We are really worried,” says Canadian Radio-television and Telecommunications Commission (CRTC) chairperson Vicky Eatrides.

Ms. Eatrides, who was testifying at the House of Commons heritage committee on Nov. 23, expressed concern about traditional Canadian broadcasters, like Québecor which laid off 547 media staff on Nov. 2, facing tough financial situations.

“This is the reason why we’re acting so quickly to determine now whether we should put in place an immediate contribution,” she said.

Bloc Québécois MP Martin Champoux asked to clarify whether Ms. Eatrides meant a “digital contribution” and she said that was the case.

The CRTC is currently holding public hearings to look at what kind of initial contributions online platforms could make to bolster the Canadian broadcasting system, remarked CRTC general counsel and deputy executive Rachelle Frenette.

This is further to the adoption in April of Bill C-11, the Online Streaming Act. The government directions to the CRTC say that foreign companies must support the broadcasting system financially.

“The requirements, both financial and non-financial, must be equitable given the size and nature of the undertaking and equitable as between foreign online undertakings and Canadian broadcasting undertakings,” it says.

The CRTC hearings started Nov. 20 and have heard from different stakeholders such as Bell Canada Enterprises, Québecor, the Directors Guild of Canada, and Sirius XM.

“These issues are of primordial importance for the commission, that’s why we started with this these [financial contribution] hearings as a priority,” said Ms. Frenette.

Mr. Champoux suggested it could be a “vain wish” to try to get money from online platform companies.

After the June passage of Bill C-18, the Online News Act, Meta started blocking access to news on platforms like Facebook and Instagram.

The legislation, lobbied for by the news sector, compels social media giants to compensate media companies for the sharing of news links on the platforms.

Ms. Frenette didn’t comment on if it would be easy to have social media giants comply, but said it’s a good step that some international entities attended the hearings.

Google attended the hearing on Nov. 21 and raised concerns about the plan to impose digital contributions.

Arun Krishnamurti, senior counsel at Google Canada, said it could “jeopardize” what the company is currently doing for Canadian artists and creators.

Mr. Krishnamurti said that a one-size-fits all approach to online platforms is inadequate given their different business models. He also said that YouTube, which like Google falls under the Alphabet Inc. umbrella, contributes in various ways to content creators.

“A regulatory requirement that imposes an initial base contribution without taking into account these existing contributions, does not acknowledge the significant impact YouTube already makes to its partners and the local broadcasting system,” said Mr. Krishnamurti.

On the side of traditional broadcasters losing ground to streaming services, Québecor CEO Pierre-Karl Péladeau blamed heavy regulations for making it impossible to compete.

“This major crisis is due in part to the heavy and archaic regulatory and financial burden which prevents our businesses to have the needed flexibility they desperately need to maintain their competitiveness and ensure their survival,” he said on Nov. 22.

Mr. Péladeau, who operates the Vidéotron cable service, blamed the requirement to offer a basic cable package with mandatory channels as well as the broadcasting and programming quotas that are imposed.